MercadoLibre shares fall; UBS downgrades to 'neutral'

MercadoLibre

29/04/2026 20:15

** Latin American e-commerce firm MercadoLibre MELI.O shares fall 2.4% to $1,749.15, a 3-week low, in Weds afternoon trading

** UBS downgraded MELI to 'neutral' from 'buy' and chopped PT to $2,050 from $2,700

** MELI is building a powerful infrastructure in LatAm, but since co announced the lower free-shipping threshold, questions around when this investment cycle can be translated into profitability have arisen, UBS analysts said in a note

** UBS believes MELI's margins will remain under pressure and only start to recover from 2027-2028 onward

** Additionally, with shares trading at 39x/27x P/E on 2026/2027 estimates, they are fairly valued when adjusted for long-term growth vs peers, UBS said

** 23 of 25 brokerages covering the shares rate them "strong buy" or "buy", 2 "hold"; median PT $2,420, according to LSEG data

** Separately, CEO Ariel Szarfsztejn told Reuters MELI could offload parts of its fast-growing loan book to support its fintech business, and downplayed its Venezuela expansion

** With the move on Weds, MELI's shares down ~13% YTD and ~22% over the past three months

(Lance Tupper is a Reuters market analyst. The views expressed are his own)

((lance.tupper@tr.com 1-646-279-6380))